When to counsel an underperforming employee

Managing poor performance is one of the biggest challenges leaders face in retail today. With increased litigation cases it is imperative that leaders get it right. If, despite coaching the team member, they’re still not performing to standard, the next step is to conduct a counselling session.

To provide effective counselling, managers need to:

  • Address the issue quickly
  • Look for the cause by helping the employee identify why the problem is occurring

It is important that counselling is not undertaken if :

  • The performance being measured was not communicated to the team member
  • If the team member has not yet been trained
  • If the team member didn’t have the tools to carry out the task.

When to counsel

Performance counselling is necessary when the team member is still not performing to the required standard after:

  • Being involved in discussing their performance standards.
  • Been given regular feedback on their ability to meet standards, including a performance review.
  • Being involved in the creation of a development plan.

A performance counselling session is conducted to help the team member understand the performance gap, reiterate the required performance standard, and put a plan in place to rectify the poor performance.

According to Cole (2005), counselling should follow three different phases:


Research the performance gap by determining whether:

  • Clear standards were set when assigning responsibilities
  • The standards are achievable given the operating environment
  • The team member was fully trained to meet the standard
  • If there were resources available to perform to company standards
  • Whether the cause of the performance problem was anything other than the team member
  • This phase should also include an initial discussion with the team member to understand their perspective


This phase should include an understanding of:

  • The team member’s issues
  • The impact the underperformance is having on the operational plan
  • What can be done to resolve the performance issue


Agreeing upon actions to:

  • Adjust existing circumstances to accommodate any barriers the team member is facing
  • How and when the team member is expected to make changes to their performance
  • Provide support to the team member
  • When there will be a follow-up meeting to review progress

Counselling outcomes

A counselling session should result in an action plan, and a follow-up meeting is set. Depending on the level of poor performance, it may also result in disciplinary action being taken.

The organisation’s disciplinary policy will dictate the disciplinary action. Industry best practice includes the following:

  • Verbal warning – issued if this is the first time the team member has failed to meet the performance standard, and the issue is relatively minor.
  • First written warning – issued if this is the first time the team member has failed to meet the performance standard.
  • Final written warning – issued if this is not the first counselling session that has taken place around this particular performance issue.

There are times where it would be appropriate to go straight to a final written warning if, for example, it was a serious breach but not serious enough for instant dismissal. When issuing warnings, managers must liaise with human resource professionals.

It is important to note that to escalate the warning from verbal to first written to final written, it must be for the same performance issue. A warning should only sit on a team member’s file as ‘active; for as long as is stated in the organisations policy – this maybe around 3-6 months.

Want to find out more about counselling an employee? The ARA Retail Institute offers a range of courses suited for job seekers, managers, and buyers. Click on ‘courses’ below to see how the Retail Institute can transform you and your business!


About ARA Retail Institute

ARA Retail Institute is Australia’s leading retail training provider for both accredited and non-accredited learning programs. For more information, please visit: www.retailinstitute.org.au



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